Please read the Risk Factors carefully. See section titled Risk Factors on page no. [ ] of this Abridged Prospectus

Transcription

1 THIS ABRIDGED PROSPECTUS CONSISTS OF 48 PAGES. PLEASE ENSURE THAT YOU GET ALL PAGES Please ensure that you read the Prospectus and the general instructions contained in this Memorandum before applying in the Issue. Unless otherwise specified, all capitalised terms used in this form shall have the meaning ascribed to such terms in the Prospectus. The investors are advised to retain a copy of Prospectus/Abridged Prospectus for their future reference. HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED Our Company was incorporated as Housing and Urban Development Finance Corporation Private Limited on April 25, 1970 as a private limited company under the Companies Act, 1956, as amended (the Companies Act ) and was granted a certificate of incorporation by the then Registrar of Companies, Delhi. Subsequently the name of our Company was changed to its present name and a fresh certificate of incorporation dated July 9, 1974 was issued by the then Registrar of Companies, Delhi and Haryana. For further details, see the section titled History and Certain Corporate Matters on page 72 of the Shelf Prospectus. Registered and Corporate Office: HUDCO Bhawan, Core- 7A, India Habitat Centre, Lodhi Road, New Delhi , India. Telephone: ; Facsimile: Compliance Officer: Mr. Rajinder Paul; Telephone: ; Facsimile: taxfreebonds@hudco.org; Website: PUBLIC ISSUE BY HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED ( COMPANY OR THE ISSUER ) OF TAX FREE BONDS OF FACE VALUE OF ` 1000 EACH IN THE NATURE OF SECURED, REDEEMABLE, NON-CONVERTIBLE DEBENTURES, HAVING BENEFITS UNDER SECTION 10(15)(IV)(H) OF THE INCOME TAX ACT, 1961, AS AMENDED ( BONDS ) AGGREGATING TO ` 750 CRORE ( BASE ISSUE SIZE ) WITH AN OPTON TO RETAIN OVERSUBSCRIPTION UPTO THE SHELF LIMIT* (I.E. ` CRORE) ( ISSUE ). THIS ISSUE IS BEING OFFERED BY WAY OF THE PROSPECTUS TRANCHE I WHICH CONTAINS, INTER ALIA, ALL TERMS AND CONDITIONS OF THE TRANCHE I (THE PROSPECTUS TRANCHE I ) WHICH SHOULD BE READ TOGETHER WITH THE SHELF PROSPECTUS DATED SEPTEMBER 11, 2013 FILED WITH THE REGISTRAR OF COMPANIES, NATIONAL CAPITAL TERRITORY OF DELHI AND HARYANA, BSE AND SEBI ( SHELF PROSPECTUS ). THE SHELF PROSPECTUS, TOGETHER WITH THE PROSPECTUS TRANCHE I SHALL CONSTITUTE THE PROSPECTUS. * In terms of the CBDT Notification (defined hereinafter), in addition to the tranche(s) of public issue, our Company may also raise Bonds on a private placement basis in one or more tranches during the process of the present Issue, not exceeding ` 1,500 crores, i.e. upto 30% of the allocated limit for raising funds through the Bonds during the Fiscal 2014, at its discretion, wherein suitable amounts shall be earmarked for subscription by Sovereign Wealth Funds, Pension and Gratuity Funds. Our Company shall ensure that Bonds issued throu gh the public issue route and private placement route shall together not exceed ` 4, crores. In case our Company raises funds through private placements during the process of the present Issue, the Shelf Limit for the Issue shall get reduced by such amount raised. The Issue is being made under the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008, as amended ( SEBI Debt Regulations ) and pursuant to notification No. 61/2013/F.No. 178/37/2013-(ITA.I) dated August 8, 2013 issued by the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Government of India ( CBDT Notification ), by virtue of powers conferred upon it by item (h) of sub-clause (iv) of clause (15) of section 10 of the Income Tax Act, 1961, as amended. GENERAL RISKS Investors are advised to read the Risk Factors carefully before taking an investment decision in relation to this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and the Issue, including the risks involved. Specific attention of the investors is invited to "Risk Factors" on page 10 of the Shelf Prospectus and "Recent Material Developments" on page 23 of the prospectus Tranche-I before making an investment in this Issue. This document has not been and will not be approved by any regulatory authority in India, including the National Housing Bank ("NHB"), the Securities and Exchange Board of India ("SEBI"), th e Reserve Bank of India ("RBI"), any registrar of companies or any stock exchange in India. ISSUER S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that the p rospectus does contain and, will contain all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in the Prospectus will be true and correct in all material respects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other material facts, the omission of which makes the Prospectus or any such information or the expression of any such opinions or intentions, misleading in any material respect at the time of the Issue. CREDIT RATING CARE has assigned a rating of CARE AA+ to the Bonds vide letter dated September 9, India Ratings and Research Private Limit ed (formerly Fitch Ratings India Private. Limited) ( IRRPL ) has assigned a rating of IND AA+ to the Bonds vide letter dated September 6, Instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk. For the rationale for this rating, see Annexure B of the Shelf Prospectu s. This rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. This rating is subject to revision or withdrawal at any time by the assigning rating agency(ies) and should be evaluated independently of any other ratings. PUBLIC COMMENTS The Draft Shelf Prospectus dated August 29, 2013 was filed with the BSE Limited ( BSE ), the Designated Stock Exchange pursuant to the provisions of the SEBI Debt Regulations on August 30, 2013 and was open for public comments for seven Working Days (as defined hereinafter) (i.e. until 5 p.m. on September 6, 2013). LISTING The Bonds are proposed to be listed on the BSE, the Designated Stock Exchange for the Issue. The BSE has given its -principle listing approval through its letter dated September 6, ISSUE PROGRAMME** ISSUE OPENS ON: SEPTEMBER 17, 2013 ISSUE CLOSES ON: OCTOBER 14, 2013 ** The Issue shall remain open for subscription from 10:00 a.m. till 5:00 PM (Indian Standard Time) for the period mentioned above, with an option for early closure or extension by such period as may be decided by the Board of Directors or a duly constituted committee thereof, or the Chairman and Managing Director. In the event of such early closure or extension of the subscription list of the Issue, our Company shall ensure that public notice of such early closure is published on or before the day of such early date of closure through advertisement/s in at least one leading national daily newspaper. A copy of the Shelf Prospectus and the Prospectus Tranche-I shall be filed with the Registrar of Companies, National Capital Territory of Delhi and Haryana, in terms of section 56 and section 60 of the Companies Act along with the requisite endorsed/certified copies of all requisite documents. For more information, see the section titled Material Contracts and Documents for Inspection on page165 of the Shelf Prospectus. Please read the Risk Factors carefully. See section titled Risk Factors on page no. [ ] of this Abridged Prospectus HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 3

2 DETAILS RELATING TO ENTITIES ASSOCIATED WITH THE ISSUE LEAD MANAGERS TO THE ISSUE AXIS CAPITAL LIMITED 1st floor, Axis House, C-2 Wadia International Centre P.B. Marg, Worli, Mumbai Telephone: (+91 22) , Facsimile: (+91 22) ID: Website: Investor Grievance ID: Contact Person: Mr. Akash Aggarwal Compliance Officer: Mr. M. Natarajan SEBI Registration Number: INM EDELWEISS FINANCIAL SERVICES LIMITED 14 th Floor, Edelweiss House, Off CST Road, Kalina, Mumbai Telephone: , Facsimile: ID: Website: Investor Grievance ID: Contact Person: Ms. Sujaya Moghepadhye/ Mr. Viral Shah Compliance Officer: Mr. B. Renganathan SEBI Registration Number: INM HDFC BANK LIMITED Investment Banking Division Trade World, A Wing, 1st Floor Kamala Mills Compound S. B. Marg, Lower Parel (West), Mumbai Telephone: , Facsimile: ID: hudcotaxfreebonds2013@hdfcbank.com Website: Investor Grievance ID: investor.redressal@hdfcbank.com Contact Person: Mr. Amit Kumar Singh Compliance Officer: Mr. Manoj Nadkarni SEBI Registration Number: INM KARVY INVESTOR SERVICES LIMITED 701, Hallmark Business Plaza Sant Dnyaneshwar Marg Off Bandra Kurla Complex, Bandra (East)- Mumbai Telephone: , Facsimile: ID: hudco2013@karvy.com, Website: Investor Grievance ID: igmbd@karvy.com/cmg@karvy.com Contact Person: Mr. Sumit Singh Compliance Officer: Mr. V Madhusudhan Rao SEBI Registration Number: INM RR INVESTORS CAPITAL SERVICES PRIVATE LIMITED 47, M.M. Road, Rani Jhansi Marg Jhandewalan, New Delhi Telephone: , Facsimile: ID: hudcotaxfree2013@rrfcl.com Website: Investor Grievance ID: investors@rrfcl.com Contact Person: Mr. Anurag Awasthi Compliance Officer: Mr. Sandeep Mahajan SEBI Registration Number: INM CONSORTIUM MEMBERS EDELWEISS SECURITIES LIMITED 2nd Floor, M.B. Towers, Plot no. 5, Road no. 2 Banjara Hills, Hyderabad Telephone: , Facsimile: ID: hudco.tfbonds@edelweissfin.com Website: Investor Grievance ID: customerservice.mb@edelweissfin.com Contact Person: Mr. Prakash Boricha SEBI Registration Number: INB (BSE)/ INB (NSE)/ INB (MCX-SX) HDFC SECURITIES LIMITED I Think Techno Campus, Alpha, Building B Office Floor 8, Opp. Crompton Greaves Kanjurmarg, Mumbai Telephone: / Facimile: ID: sunil.raula@hdfcsec.com/sharmila.kambli@hdfcsec.com Website: Investor Grievance ID: customercare@hdfcsec.com Contact Person: Mr. Sunil Raula SEBI Registration No.: INB (BSE) and INB (NSE) RR EQUITY BROKERS PRIVATE LIMITED 47, M. M. Road, Rani Jhansi Marg Jhandewalan, New Delhi Telephone: Facimile: ID: manishagrawal@rrfcl.com Website: Investor Grievance ID: investors@rrfcl.com Contact Person: Mr. Manish Agrawal SEBI Registration No.: INB (BSE) and INB (NSE) Karvy Stock Broking Limited Karvy House, 46, Avenue 4 Street no. 1, Banjara Hills, Hyderabad Telephone: , Facimile: ID: hudco2013@karvy.com, Website: Investor Grievance ID: ksblredressal@karvy.com Contact Person: Mr. P. B. Ramapriyan SEBI Registration No.: INB (NSE) /INB (BSE) 4 HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED

3 REGISTRAR TO THE ISSUE KARVY COMPUTERSHARE PRIVATE LIMITED Plot No. 17 to 24, Vithal Rao Nagar Madhapur, Hyderabad , India Telephone: , Facsimile ID: Website: Investor Grievance ID: Contact Person: Mr. M. Murali Krishna SEBI Registration Number: INR DEBENTURE TRUSTEE SBICAP TRUSTEE COMPANY LIMITED Apeejay House, 6 th Floor Dinshaw Wacha Road, Churchgate, Mumbai Telephone: , Facsimile: corporate@sbicaptrustee.com Investor Grievance ID: investor.cell@sbicaptrustee.com Website: Contact person: Mr. Ajit Joshi SEBI Registration No: IND The Debenture Trustee has consented to act as a debenture trustee in relation to the Issue under regulation 4(4) of the SEBI Debt Regulations. See Annexure C on page 310 of the Shelf Prospectus for the consent letter of the Debenture Trustee. COMPLIANCE OFFICER Mr. Rajinder Paul Executive Director (Finance) HUDCO Bhawan, Core- 7A, India Habitat Centre Lodhi Road, New Delhi Telephone: , Facsimile: taxfreebonds@hudco.org Investors can contact the Compliance Officer or the Registrar to the Issue in case of any pre Issue or post Issue related problems, such as non-receipt of Allotment Advice, credit of Allotted Bonds in beneficiary accounts, Bond Certificates (for Applicants who have applied for Allotment in physical form), refund orders and interest on the Application Amounts. STATUTORY AUDITORS Dhawan & Co., Chartered Accountants 312, Wegmans House, 21Veer Savarkar Block Shakarpur, Vikas Marg, New Delhi Telephone: / Facsimile: ID: dpa111@hotmail.com/ gogia.sunil@gmail.com Firm registration no.: N, Auditors since: July 29, 2013 LEGAL COUNSEL TO THE COMPANY Luthra & Luthra Law Offices 103, Ashoka Estate, 24, Barakhamba Road New Delhi Telephone: , Facsimile: ESCROW COLLECTION BANKS / BANKERS TO THE ISSUE Axis Bank Limited 148, Statesman House, Barakhamba Road, New Delhi Telephone: / Facsimile: / newdelhi.branchhead@axisbank.com/ amit.mishra@axisbank.com/ ashish.dhall@axisbank.com Contact person: Mr. Amit Mishra/ Mr. Ashish Dhall Website: SEBI Registration Number: INBI IDBI Bank Limited Unit No. 2, Corporate Park, Sion Trombay Road, Chembur, Mumbai Telephone: , Facsimile: ipoteam@idbi.com, Website: Contact person: Mr. V. Jayananthan SEBI Registration Number: INB State Bank of India* Capital Market Branch, Videocon Heritage, Ground Floor, Charanjit Rai Marg, Mumbai Telephone: , Facsimile: agm.11777@sbi.co.in, Website: Contact person: Mr. D.B.Surti SEBI Registration Number: INB * HDFC Bank Limited FIG-OPS Department, Lodha I Think Techno Campus,O-3level, Next to Kanjurmarg Station, Kanjurmarg (East), Mumbai Telephone: / , Facsimile: siddharth.jadav@hdfcbank.com/ udit.dixit@hdfcbank.com Contact person: Mr. Siddharth Jadhav/ M. Uday Dixit Website: SEBI Registration Number: INB ICICI Bank Limited Capital Markets Division, 1st Floor, 122, Mistry Bhavan, Dinshaw Vachha Road, Backbay Reclamation, Churchgate, Mumbai Telephone: , Facsimile: anil.gadoo@icicibank.com, Website: Contact person: Mr. Anil Gadoo SEBI Registration Number: INBI IndusInd Bank Limited Cash Management Services, Solitaire Park, No. 1001, Building No. 10, Ground Floor, Guru Hargovindji Marg, Andheri (East), Mumbai Telephone: to 3917, Facsimile: sanjay.vasarkar@indusind.com Website: Contact person: Mr. Sanjay Vasarkar SEBI Registration Number: INBI Kotak MahindraBank Limited Kotak Infiniti, 6th Floor, Building No. 21, Infinity Park, Off Western Express Highway General A.K.Vaidya Marg, Malad (E), Mumbai Telephone: , Facsimile: prashant.sawant@kotak.com, Website: Contact person: Mr. Prashant Sawant SEBI Registration Number: INBI HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 5

4 Yes Bank Limited IFC, Tower 2, 8th Floor, Senapati Bapat Marg, Elphinstone (W), Mumbai Telephone: , Facsimile: dlbtiservices@yesbank.in, Website: Contact person: Mr. Shankar Vichare/Mr. Paresh Kulkarni SEBI Registration Number: INBI * The SEBI registration of State Bank of India as a Banker to the Issue expired on November 30, State Bank of India has applied for renewal of its registration certificate on November 27, 2012 prior to the expiry of its registration. The approval of SEBI in this regard is awaited. REFUND BANKS Axis Bank Limited Axis Bank Limited, 148, Statesman House, Barakhamba Road, New Delhi Telephone: / / Facsimile: / newdelhi.branchhead@axisbank.com/ amit.mishra@axisbank.com/ashish.dhall@axisbank.com Contact person: Mr. Amit Mishra, Mr. Ashish Dhall Website: SEBI Registration Number: INB IDBI Bank Limited Unit No. 2, Corporate Park, Sion Trombay Road, Chembur, Mumbai Telephone: , Facsimile: ipoteam@idbi.com, Website: Contact person: Mr. V. Jayananthan SEBI Registration Number: INB SELF CERTIFIED SYNDICATE BANKS The banks which are registered with SEBI under the Securities and Exchange Board of India (Bankers to an Issue) Regulations, 1994 and offer services in relation to ASBA, including blocking of an ASBA Account, a list of which is available on or at such other website as may be prescribed by SEBI from time to time. CREDIT RATING AGENCIES Credit Analysis & Research Limited 3 rd Floor, B 47, Inner Circle, Connaught Place Near Plaza Cinema, New Delhi Telephone: , Facsimile: jyotsna.gadgil@careratings.com Website: Contact person: Ms. Jyotsna Gadgil SEBI Registration No.: IN/CRA/004/1999 Indian Ratings and Research Private Limited Wockhardt Towers, 4 th Floor Bandra Kurla Complex, Bandra (East), Mumbai Telephone: , Facsimile: shrikant.dev@indianratings.co.in Contact person: Shrikant Dev Website: SEBI Registration No.: IN/CRA/002/1999 DISCLAIMER Participation of any of the aforementioned categories of persons or entities is subject to the applicable statutory and/or regulatory requirements in connection with the subscription to Indian securities by such categories of persons or entities. Applicants are advised to ensure that Applications made by them do not exceed the investment limits or maximum number of Bonds that can be held by them under applicable statutory and or regulatory provisions. Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory permissions/consents/ approvals in connection with applying for, subscribing to, or seeking Allotment of Bonds pursuant to the Issue. The Lead Managers and their respective associates and affiliates are permitted to subscribe in the Issue. Applicants are advised to read the Shelf Prospectus and the relevant Prospectus Tranche-I filed with Registrar of Companies and the general instructions contained in this application form carefully and to satisfy themselves of the disclosures before making an application for subscription. Unless otherwise specified, all the terms used in this Application Form have the same meaning as in the Prospectus. For a copy of the Prospectus, the applicant may request us and/or the Lead Managers. Further investors are advised to retain the copy of the Prospectus/Abridged Prospectus for their future reference. Please fill in the Form in English using BLOCK letters. Investors should carefully choose the Series of Bonds they wish to apply for. For details, please refer to section Terms of the Issue on page [*] of the Prospectus Tranche-I. TABLE OF CONTENTS OBJECTS OF THE ISSUE 7 ISSUE PROCEDURE 7 PAYMENT INSTRUCTIONS 16 OTHER INSTRUCTIONS 27 DETAILS PERTAINING TO THE COMPANY 30 LEGAL AND OTHER INFORMATION 32 RISK FACTORS 36 DECLARATION 38 CENTERS FOR AVAILABILITY AND ACCEPTANCE 39 OF APPLICATION FORMS LIST OF SELF CERTIFIED SYNDICATE BANKS 47 (SCSBS) UNDER THE ASBA PROCESS 6 HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED

5 DETAILS PERTAINING TO THE ISSUE OBJECTS OF THE ISSUE 1. Issue Proceeds The CBDT has, by the CBDT Notification, authorised our Company to raise the Bonds aggregating to ` 5, crores out of which our Company has already raised an amount of ` crores on a private placement basis through a disclosure document dated August 30, 2013 and a resolution of the Resource Committee (sub-committee of the Board) on September 2, Our Company proposes to raise the balance amount of ` 4, crores * through a public issue of the Bonds in one or more tranches prior to March 31, * In terms of the CBDT Notification, in addition to the tranche(s) of public issue, our Company may also raise Bonds on a private placement basis in one or more tranches during the process of the present Issue, not exceeding ` 1,500 crores, i.e. upto 30% of the allocated limit for raising funds through the Bonds during the Fiscal 2014, at its discretion, wherein suitable amounts shall be earmarked for subscription by Sovereign Wealth Funds, Pension and Gratuity Funds. Our Company shall ensure that Bonds issued through the public issue route and private placement route shall together not exceed ` 4, crores. In case our Company raises funds through private placements during the process of the present Issue, the Shelf Limit for the Issue shall get reduced by such amount raised. In terms of the Foreign Exchange Management (Borrowing and Lending in Rupees) Regulations, 2000 (the FEMA Borrowing Regulations ), monies borrowed in Indian rupees from persons resident outside India (as defined in FEMA) cannot be utilised for re-lending activities. Consequently, subscription monies raised through the Issue from FIIs, Eligible NRIs, Eligible QFIs and other non resident Applicants across all Categories shall not be utilised for relending activities and our Company shall keep all subscription monies received from FIIs, Eligible NRIs, Eligible QFIs and all other non resident Applicants across all Categories in a separate account opened and maintained by the Company, the proceeds of which account shall not be utilised for any lending purposes in terms of Regulation 6(2) of the FEMA Borrowing Regulations, and shall be utilized for the following purposes: (a) Debt servicing, which includes servicing of both the principal amounts as well as interest payments of various debt facilities availed by our Company in the past and currently outstanding in its books of accounts, including loans, market borrowings (which include our non-convertible bonds/ debentures); (b) Statutory payments; (c) Establishment and administrative expenses; (d) Other working capital requirements of our Company; and (e) Any other purposes and end-uses as may be allowed by RBI from time to time through relevant regulations/guidelines/clarifications issued by RBI. The main objects clause of the Memorandum of Association permits our Company to undertake its existing activities as well as the activities for which the funds are being raised through the Issue. Further, in accordance with the SEBI Debt Regulations, our Company is required to not utilize the proceeds of the Issue for providing loans to or acquisition of shares of any person who is a part of the same group as our Company or who is under the same management as our Company or any subsidiary of our Company. Our Company does not have any subsidiary. Further, our Company is a public sector enterprise and as such, there are no identifiable group companies or companies under the same management. The Issue proceeds shall not be utilized towards full or part consideration for the purchase or any other acquisition, among other things, by way of a lease, of any property. 2. Interim use of Proceeds The Board of Directors, in accordance with the policies formulated by them from time to time, will have flexibility in deploying the proceeds received from the Issue. Pending utilization of the proceeds out of the Issue for the purposes described above, our Company intends to temporarily invest funds in deposits with banks or as may be approved by the Board. Such investment would be in accordance with the Board approved guidelines prepared on the basis of directions received from DPE. 3. Monitoring of Utilization of Funds There is no requirement for appointment of a monitoring agency in terms of the SEBI Debt Regulations. The Board of Directors of our Company shall monitor the utilisation of the proceeds of the Issue. Our Company will disclose in our Company s financial statements for the relevant financial year commencing from Fiscal 2014, the utilization of the proceeds of the Issue under a separate head along with details, if any, in relation to all such proceeds of the Issue that have not been utilized thereby also indicating investments, if any, of such unutilized proceeds of the Issue. Further, in accordance with the Debt Listing Agreement, our Company will furnish to the BSE on a half yearly basis, a statement indicating material deviations, if any, in the use of Issue proceeds and shall also publish the same in newspapers simultaneously with the half-yearly financial results. We shall utilize the proceeds of the Issue only upon execution of the documents for creation of security as stated in the Prospectus Tranche I in the section titled Terms of the Issue on page 43 and upon the listing of the Bonds. ISSUE PROCEDURE This section applies to all Applicants. ASBA Applicants and Applicants applying through the Direct Online Application Mechanism (as defined hereinafter) should note that the ASBA process and the Direct Online Application Mechanism involves application procedures that are different from the procedure applicable to all other Applicants. Please note that all Applicants are required to pay the full Application Amount or ensure that the ASBA Account has sufficient credit balance such that the entire Application Amount can be blocked by the SCSB while making an Application. In case of ASBA Applicants, an amount equivalent to the full Application Amount will be blocked by the SCSBs in the relevant ASBA Accounts. ASBA Applicants should note that they may submit their ASBA Applications to the Members of the Syndicate or Trading Members only at the Syndicate ASBA Application Locations, or directly to the Designated Branches of the SCSBs. Applicants other than ASBA Applicants are required to submit their Applications to the Members of the Syndicate or Trading Members (at the application centres of the Members of the Syndicate will be mentioned in the Application Form) or make online Applications using the online payment gateway of the relevant Stock Exchange(s). Applicants are advised to make their independent investigations and ensure that their Applications do not exceed the investment limits or maximum number of Bonds that can be held by them under applicable law or as specified in the Shelf Prospectus and the Prospectus Tranche I. Please note that this section has been prepared based on the circular no. CIR./IMD/DF-1/20/2012 dated July 27, 2012 issued by SEBI ( Debt Application Circular ). The procedure mentioned in this section is subject to the Stock Exchange(s) putting in place HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 7

6 the necessary systems and infrastructure for implementation of the provisions of the abovementioned circular, including the systems and infrastructure required in relation to Applications made through the Direct Online Application Mechanism and the online payment gateways to be offered by the Stock Exchange(s) and accordingly is subject to any further clarifications, notification, modification, direction, instructions and/or correspondence that may be issued by the Stock Exchange(s) and/or SEBI. The Members of the Syndicate and the Company shall not be responsible or liable for any errors or omissions on the part of trading members in connection with the responsibility of Trading Members in relation to collection and upload of Applications in this issue on the electronic application platform provided by the relevant Stock Exchange(s). Further the relevant Stock Exchange(s) will be responsible for addressing investor grievances arising from applications through Trading Members. PROCEDURE FOR APPLICATION 4. Availability of the Abridged Prospectus and Application Forms Please note that there is a single Application Form for ASBA Applicants as well as non-asba Applicants who are persons resident in India. There is a separate Application Form for Applicants (ASBA Applicants and non-asba Applicants) who are FIIs, Eligible NRIs, Eligible QFIs and all other non-resident Applicants across all Categories applying for Bonds on repatriation or a non-repatriation basis. Copies of the Abridged Prospectus containing the salient features of the Prospectus Tranche I together with Application Forms may be obtained from our Registered Office, the Lead Managers, the Consortium Members and the Designated Branches of the SCSBs. Additionally the Prospectus Tranche I and the Application Forms will be available for download on the website of the Designated Stock Exchange at and other relevant Indian stock exchanges, the websites of the Lead Managers at and respectively. Electronic Application Forms will also be available on the website of the relevant Stock Exchange(s). A hyperlink to the website of the relevant Stock Exchanges(s) for this facility will be provided on the website of the Lead Managers and the SCSBs. Trading Members can download Application Forms from the website of the relevant Stock Exchange(s). Further, Application Forms will also be provided to Trading Members at their request. The prescribed colour of the Application Form for the Applicants is as follows: Category Resident Indians (ASBA and non-asba Applicants) FIIs (including Sovereign Wealth Funds, Pension Funds and Gratuity Funds registered as FIIs with SEBI), Eligible NRIs (applying on a repatriation as well as non-repatriation basis), Eligible QFIs and any other non-resident Applicant across all Categories. Colour of the Application Form Wh it e Blue 5. Who can apply? The following categories of persons are eligible to apply in the Issue. Category I Public Financial Institutions, scheduled commercial banks, multilateral and bilateral development financial institutions, state industrial development corporations, which are authorised to invest in the Bonds; Provident funds and pension funds with minimum corpus of ` 8 HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 25 crores, which are authorised to invest in the Bonds; Insurance companies registered with the IRDA; Foreign Institutional Investors and sub-accounts (other than a sub account which is a foreign corporate or foreign individual) registered with SEBI, including Sovereign Wealth Funds, Pension and Gratuity Funds registered with SEBI as Foreign Institutional Investors; National Investment Fund (set up by resolution no. F. No. 2/3/ 2005-DDII dated November 23, 2005 of the Government of India and published in the Gazette of India); Insurance funds set up and managed by the army, navy or air force of the Union of India or set up and managed by the Department of Posts, India; Mutual funds registered with SEBI; and Alternative Investment Funds, subject to investment conditions applicable to them under the Securities and Exchange Board of India (Alternative Investment Funds) Regulations, Category II Companies within the meaning of section 3 of the Companies Act * ; Statutory bodies/corporations * ; Cooperative banks; Public/ private/ religious trusts; Limited Liability Partnerships; Eligible QFIs (not being individuals); Regional rural banks; Societies registered under applicable laws in India and authorised to invest in the Bonds; Associations of persons; Partnership firms in the name of partners; and Any other foreign/ domestic legal entities/ persons as may be permissible under the CBDT Notification and authorised to invest in the Bonds in terms of applicable laws. * The MCA has, through its circular (General Circular No. 06/ 2013) dated March 14, 2013, clarified that companies investing in tax-free bonds wherein the effective yield on the bonds exceeds the yield on the prevailing bank rate will not be in violation of section 372A(3) of the Companies Act. Category III The following Investors applying for an amount aggregating to above ` 10 lakhs across all Series of Bonds in the Issue: Resident Indian individuals; Eligible NRIs on a repatriation or non repatriation basis; Hindu Undivided Families through the Karta; and Eligible QFIs, being individuals. Category IV The following Investors applying for an amount aggregating to up to and including ` 10 lakhs across all Series of Bonds in the Issue: Resident Indian individuals; Eligible NRIs on a repatriation or non repatriation basis; Hindu Undivided Families through the Karta; and Eligible QFIs, being individuals. Participation of any of the aforementioned categories of persons or entities is subject to the applicable statutory and/or regulatory requirements in connection with the subscription to Indian securities by such categories of persons or entities. An FII, Eligible NRI, Eligible QFI or any other non-resident Appli-

7 cant applying in the Issue must not be (i) based in the United States of America ( USA ), and/or, (ii) domiciled in the USA, and/ or, (iii) residents/citizens of the USA, and/or, (iv) subject to any taxation laws of the USA. Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory permissions/consents/approvals in connection with applying for, subscribing to, or seeking allotment of Bonds pursuant to the Issue. The Lead Managers and their respective associates and affiliates are permitted to subscribe in the Issue. The information below is given for the benefit of Applicants. Our Company and the Lead Managers are not liable for any amendment or modification or changes in applicable laws or regulations, which may occur after the date of the Shelf Prospectus. 6. Who cannot apply Applications cannot be made by: a) Minors without a guardian name (A guardian may apply on behalf of a minor. However, Applications by minors must be made through Application Forms that contain the names of both the minor Applicant and the guardian); b) Foreign nationals, except as may be permissible under the CBDT Notification or under the applicable law; c) Non resident Investors, including FIIs, NRIs and QFIs who are (i) based in the USA, and/or, (ii) domiciled in the USA, and/ or, (iii) residents/citizens of the USA, and/or, (iv) subject to any taxation laws of the USA; d) Overseas Corporate Bodies; e) Indian Venture Capital Funds; f) Foreign Venture Capital Investors; and g) Persons ineligible to contract under applicable statutory/ regulatory requirements. In case of Applications for Allotment of the Bonds in dematerialised form, the Registrar shall verify the above on the basis of the records provided by the Depositories based on the DP ID and Client ID provided by the Applicants in the Application Form and uploaded onto the electronic system of the relevant Stock Exchange(s) by the Members of the Syndicate, SCSBs or the Trading Members, as the case may be. Nothing in the Shelf Prospectus constitutes an offer of Bonds for sale in the United States or any other jurisdiction where it is unlawful to do so. The Bonds have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the Securities Act), or the securities laws of any state of the United States or other jurisdiction and the Bonds may not be offered or sold within the United States or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The Issuer has not registered and does not intend to register under the U.S. Investment Company Act, 1940 in reliance on section 3(c)(7) thereof. The Shelf Prospectus may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever, and in particular, may not be forwarded to any U.S. Person or to any U.S. address. No offer to the public (as defined under Directive 20003/71/EC, together with any amendments and implementing measures thereto, (the Prospectus Directive ) has been or will be made in respect of the Issue or otherwise in respect of the Bonds, in any member State of the European Economic Area which has implemented the Prospectus Directive except for any such offer made under exemptions available under the Prospectus Directive, provided that no such offer shall result in a requirement to publish or supplement a prospectus pursuant to the Prospectus Directive, in respect of the Issue or otherwise in respect of the Bonds. Any forwarding, distribution or reproduction of this document in whole or in part is unauthorised. Failure to comply with this directive may result in a violation of the Securities Act or the applicable laws of other jurisdictions. Any investment decision should be made on the basis of the final terms and conditions of the bonds and the information contained in the Prospectus Tranche I. 7. Methods of Application An eligible Investor may apply in the Issue through one of the following methods: 1. Applications through the ASBA process; and 2. Non-ASBA Applications. Note Applicants are requested to note that in terms of the Debt Application Circular, SEBI has mandated issuers to provide, through a recognized stock exchange which offers such a facility, an online interface enabling direct application by investors to a public issue of their debt securities with an online payment facility ( Direct Online Application Mechanism ). In this regard, SEBI has, through the Debt Application Circular, directed recognized stock exchanges in India to put in necessary systems and infrastructure for the implementation of the Debt Application Circular and the Direct Online Application Mechanism. In the event that the relevant Stock Exchanges put in necessary systems, infrastructure and processes in place so as to enable the adoption of the Direct Online Application Mechanism prior to the Issue Opening Date, we shall offer eligible investors desirous of applying in the Issue the option to make Applications through the Direct Online Application Mechanism. If such systems, infrastructures or processes are put in place by the relevant Stock Exchange(s) after the filing of the Prospectus Tranche I but prior to the Issue Opening Date, the methods and procedure for relating to the Direct Online Application Mechanism shall be widely disseminated by us through a public notice in a reputed national daily newspaper. Applications through the ASBA process Please note that application through ASBA is optional for all categories of Applicants. Applicants who wish to apply through the ASBA process by filling in physical Application Forms will have to select the ASBA mechanism in the Application Forms and provide necessary details. Applicants can submit their Applications through the ASBA process by submitting the Application Forms to the Designated Branch of the SCSB with whom the ASBA Account is maintained or through the Members of the Syndicate or Trading Members (ASBA Applications through the Members of the Syndicate and Trading Members shall hereinafter be referred to as the Syndicate ASBA ), prior to or on the Issue Closing Date. ASBA Applications through the Members of the Syndicate and Trading Members is permitted only at the Syndicate ASBA Application Locations (Mumbai, Chennai, Kolkata, Delhi, Ahmedabad, Rajkot, Jaipur, Bangalore, Hyderabad, Pune, Vadodara and Surat). Kindly note that Application Forms submitted by ASBA Applicants to Members of the Syndicate and the Trading Members at the Syndicate ASBA Application Locations will not be accepted if the SCSB with which the ASBA Account, as specified in the Application Form is maintained has not named at least one branch at that location for the Member of the Syndicate or the Trading Members to deposit the Application Form (A list of such branches is available at Recognised-Intermediaries). Members of the Syndicate and Trading Members shall, upon re- HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 9

8 ceipt of Application Forms from ASBA Applicants, upload the details of these Application Forms to the online platform of the relevant Stock Exchange(s) and submit these Application Forms with the SCSB with whom the relevant ASBA Accounts are maintained in accordance with the Debt Application Circular. The SCSB shall block an amount in the ASBA Account equal to the Application Amount specified in the Application Form. ASBA Applications in electronic mode will only be available with such SCSBs who provide such an electronic facility. In case of ASBA Applications in such electronic form, the ASBA Applicant shall submit the Application Form with instruction to block the Application Amount either through the internet banking facility available with the SCSB, or such other electronically enabled mechanism for applying and blocking funds in the ASBA Account held with SCSB, as would be made available by the concerned SCSB. Our Company, our directors, affiliates, associates and their respective directors and officers, Lead Managers and the Registrar shall not take any responsibility for acts, mistakes, errors, omissions and commissions etc. in relation to ASBA Applications accepted by SCSBs and Trading Members, Applications uploaded by SCSBs, Applications accepted but not uploaded by SCSBs or Applications accepted and uploaded without blocking funds in the ASBA Accounts. It shall be presumed that for Applications uploaded by SCSBs, the Application Amount has been blocked in the relevant ASBA Account. Further, aall grievances against Trading Members in relation to the Issue should be made by Applicants directly to the relevant Stock Exchange(s). Please note that you cannot apply for the Bonds through the ASBA process if you wish to be Allotted the Bonds in physical form. Non-ASBA Applications (i) Non- ASBA Applications for Allotment of the Bonds in dematerialised form Applicants may submit duly filled in Application Forms either in physical or downloaded Application Forms to the Members of the Syndicate or the Trading Members accompanied by account payee cheques/ demand drafts prior to or on the Issue Closing Date. The Members of the Syndicate and Trading Members shall, upload the non-asba Application on the online platform of the relevant Stock Exchange(s), following which they shall acknowledge the uploading of the Application Form by stamping the acknowledgment slip with the date and returning it to the Applicant. This acknowledgment slip shall serve as the duplicate of the Application Form for the records of the Applicant and the Applicant should preserve this and should provide the same for any grievances relating to their Applications. Upon uploading the Application on the online platform of the relevant Stock Exchange(s), the Members of the Syndicate and Trading Members will submit the Application Forms, along with the payment instruments to the Escrow Collection Banks, which will realise the payment instrument, and send the Application details to the Registrar. The Members of the Syndicate/ Trading Members are requested to note that all payment instruments are required to be banked with only the banking branches of the Escrow Collection Banks, details of which will be available at the websites of the Lead Managers at and respectively (A link for the said websites will be available at the website of the BSE at and other relevant Indian stock exchanges at their respective websites). Accordingly, Applicants are requested to note that they must submit Application Forms to Trading Members who are located in towns/ cities which have at least one 1 0 HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED banking branch of the Escrow Collection Banks. The Registrar shall match the Application details as received from the online platform of the relevant Stock Exchange(s) with the Application Amount details received from the Escrow Collection Banks for reconciliation of funds received from the Escrow Collection Banks. In case of discrepancies between the two data bases, the details received from the online platform of the relevant Stock Exchange(s) will prevail. Upon Allotment, the Registrar will credit the Bonds in the demat accounts of the successful Applicants as mentioned in the Application Form. Please note that neither our Company, nor the Members of the Syndicate, nor the Registrar shall be responsible for redressal of any grievances that Applicants may have in regard to the non- ASBA Applications made to the Trading Members, including, without limitation, relating to non-upload of the Applications data. All grievances against Trading Members in relation to the Issue should be made by Applicants to the relevant Stock Exchange(s). (ii) Non- ASBA Applications for Allotment of the Bonds in physical form Applicants (except for Eligible QFIs) can also apply for Allotment of the Bonds in physical form by submitting duly filled in Application Forms to the Members of the Syndicate or the Trading Members, along with the accompanying account payee cheques or demand drafts representing the full Application Amount and KYC documents as specified in the sections titled Issue Procedure Applications by various Applicant Categories and Issue Procedure - Additional instructions specific for Applicants seeking Allotment of the Bonds in physical form at pages 62 and 76 of the Prospectus Tranche -1, respectively. The Members of the Syndicate and Trading Members shall, upon submission of the Application Forms to them, verify and check the KYC documents submitted by such Applicants and upload details of the Application on the online platform of the relevant Stock Exchange(s), following which they shall acknowledge the uploading of the Application Form by stamping the acknowledgment slip with the date and returning it to the Applicant. This acknowledgment slip shall serve as the duplicate of the Application Form for the records of the Applicant and the Applicant shall preserve this and should provide the same for any queries relating to non-allotment of Bonds in the Issue. Upon uploading of the Application details, the Members of the Syndicate and Trading Members will submit the Application Forms, along with the payment instruments to the Escrow Collection Banks, which will realise the payment instrument, and send the Application Form and the KYC documents to the Registrar. The Registrar shall check the KYC documents submitted and match Application details as received from the online platform of the relevant Stock Exchange(s) with the Application Amount details received from the Escrow Collection Banks for reconciliation of funds received from the Escrow Collection Banks. In case of discrepancies between the two data bases, the details received from the online platform of the relevant Stock Exchange(s) will prevail. The Members of the Syndicate/ Trading Members are requested to note that all Applicants are required to be banked with only the banking branches of Escrow Collection Banks, details of which will be available at the websites of the Lead Managers at and respectively (A link for the said websites will be available at the website of the BSE at and other Indian stock exchanges at their respective websites). Accordingly, Applicants are requested to note that they must submit Application Forms to Trading Members who are located in towns/ cities which have at least one banking branch of the Escrow Collection Banks. Upon Allot-

9 ment, the Registrar will dispatch Bond Certificates to the successful Applicants to their addresses as provided in the Application Form. Please note that, in the event that KYC documents of an Applicant are not in order, the Registrar will withhold the dispatch of Bond Certificates pending receipt of complete KYC documents from such Applicant. In such circumstances, successful Applicants should provide complete KYC documents to the Registrar at the earliest. Please note that in such an event, any delay by the Applicant to provide complete KYC documents to the Registrar will be at the Applicant s sole risk and neither our Company, the Registrar, the Escrow Collection Banks, or the Members of the Syndicate, will be liable to compensate the Applicants for any losses caused to them due to any such delay, or liable to pay any interest on the Application Amounts for such period during which the Bond Certificates are withheld by the Registrar. Further, our Company will not be liable for any delays in payment of interest on the Bonds allotted to such Applicants, and will not be liable to compensate such Applicants for any losses caused to them due to any such delay, or liable to pay any interest for such delay in payment of interest on the Bonds. Further, please note that Eligible QFIs cannot apply for Allotment of the Bonds in physical form. For further information, see the section titled Issue Procedure Applications by various Applicant Categories Applications by Eligible QFIs on page 65 of the Prospectus Tranche -1. Members of the Syndicate or Trading Members are also required to ensure that the Applicants are competent to contract under the Indian Contract Act, 1872 including minors applying through guardians, at the time of acceptance of the Application Forms. To supplement the foregoing, the mode and manner of Application and submission of Application Forms is illustrated in the following chart. Mode of Application * To whom the Application Form has to be submitted ASBA Applications (i) to the Members of the Syndicate only at the Syndicate ASBA Application Locations; or (ii) to the Designated Branches of the SCSBs where the ASBA Account is maintained; or (iii) to Trading Members only at the Syndicate ASBA Application Locations. Non- ASBA (i) to the Members of the Syndicate; or Applications (ii) to Trading Members. Please note that Eligible QFIs cannot make Applications for Allotment of the Bonds in physical form. 8. Application Size Applications are required to be for a minimum of five Bonds and multiples of one Bond thereafter. APPLICATIONS BY VARIOUS APPLICANT CATEGORIES limits. In particular, the SEBI circular bearing reference No. CIR/ IMD/FIIC/6/2013, dated April 1, 2013 provides that the following categories of debt limits shall be merged into a single category named Corporate Debt : 1. Corporate debt Old for FIIs (US$ 20 billion). 2. Corporate debt Old for QFIs (US$ 1 billion). 3. Corporate debt Long Term (US$ 5 billion). 4. Corporate debt in relation to the long term infrastructure sector (US$ 12 billion). 5. Investment by QFIs in debt mutual fund schemes which invest in the infrastructure sector (US$ 3 billion). 6. Investment in Infrastructure Debt Funds (US$ 10 billion). The combined limit for FIIs in the Corporate Debt category is US$ 51 billion, as provided in the table below. Type of Investment cap Eligible Remarks Instrument (US$ billion) Investors Government Debt 25 FIIs and QFIs Eligible investors may invest in Treasury Bills only up to US$ 5.5 billion within the limit of US$ 25 billion Corporate Debt 51 FIIs and QFIs Eligible investors may invest in Commercial Papers only up to US$ 3.5 billion within the limit of US$ 51 billion The RBI has, through its circular (bearing RBI/ /391) dated January 24, 2013 enhanced the limit for investment by FIIs in the government debt (long term) category by US$ 5 billion to US$ 15 billion and the corporate non-infrastructure debt category by US$ 5 billion. In terms of the aforesaid RBI circular, the changes are summarized below: a) In the government debt (long term), the provision regarding 3 years residual maturity at the time of first purchase shall no longer be applicable. However, within this category, FIIs shall not be allowed to invest in short term paper like treasury bills. b) In terms of the aforesaid circular, the limit of US$ 5 billion in the corporate non-infrastructure debt shall not be available for investment in certificate of deposits and commercial paper. Investments in certificate of deposits are not permitted within the limit of US$ 20 billion. c) The US $ 1 billion limit for QFIs shall continue to be over and above the revised limit of US$ 25 billion available for FII investment in corporate non-infrastructure debt. d) For the US$ 12 billion sub-category for investment in corporate long term infrastructure bonds, the following changes have been made : (i) The restriction of 1 year lock-in period has been removed. (ii) The 5 year initial maturity restriction has been removed. At the time of first purchase by FIIs, the residual maturity shall be 15 months. e) For the sub-category of US$ 10 billion reserved for FII investments in Infrastructure Debt Funds, the restriction of 1 year lock-in has been removed. The requirement of residual maturity of 15 months at the time of first purchase remains unchanged. f) Through its circular (bearing CIR/IMD/FII&C/18/2012) dated July 20, 2012, SEBI had permitted QFIs to invest in those debt mutual fund schemes that hold at least 25% of their assets (either in debt or equity or both) in the infrastructure sector under the US$ 3 billion investment limit for debt mutual fund schemes. These schemes were required to invest in infrastructure debt having a minimum residual maturity of 5 years. This restriction of 5 years residual maturity has been removed while the restriction of 3 years initial maturity has been introduced. g) All the above changes in lock-in, initial maturity and residual 9. Applications by FIIs^ An FII who purchases the Bonds under this Issue shall make the payment for purchase of such securities either by inward remittance through normal banking channels or out of funds held in Foreign Currency Account or Non-resident Rupee Account maintained by such FII with a designated branch of an authorized dealer in terms of the applicable regulations governing the same. Applications by FIIs for Allotment of the Bonds in physical form must be accompanied by certified true copies of (i) its SEBI registration certificate; (ii) an inward remittance certificate; (iii) a resolution authorising investment in the Bonds; and (iv) specimen signatures of authorised persons. Investments by FIIs Investments by FIIs in the Issue will be restricted by various circulars issued by SEBI and RBI providing for corporate debt HOUSING AND URBAN DEVELOPMENT CORPORATION LIMITED 11